Cisco rallies on analyst upgrade

Check Points sees gains, while TI slips

EmilyChurch

NEW YORK (CBS.MW) - Shares of Cisco Systems rallied in pre-open trading following an upgrade, helping to stoke investor enthusiasm in the tech sector.

Cisco
CSCO, +0.04%
climbed 91 cents, or 5.1 percent, to $18.90 in Instinet. Analyst Nikos Theodosopoulos at UBS Warburg raised his rating on the networking giant to "buy" from "hold," and lifted his price target to $24 from $20, citing indications that the company wasn't "scrambling" to hit its July-quarter targets, "and there is a sense of calm at the company." He added that although the company's telecom business continues to remain tough, its metro optical product line appears "poised for a rebound."

Stock futures were also given a needed lift, and indicated U.S. share markets would start the day on higher ground. September S&P futures tacked on 8.00 to 1,223.00, which was about 6 3/4-points above fair value, according to figures provided by HL Camp & Company. Nasdaq 100 futures climbed 33.50, or about 28 3/4-points above fair value, to 1,717.00.

Checkpoint up

Shares of Check Point Software
CHKP, +0.82%
were lifted $3.33, or 9.4 percent, to $38.75 after reporting results. The company said second-quarter earnings of $86.8 million, or 33 cents per share, were up from EPS of 17 cents in the year earlier period. Results were a penny better than the consensus analyst estimate compiled by First Call/Thomson Financial.

The company added that it generated positive cash flow of $101.5 million, and now has $866 million in cash and interest bearing investments. The stock closed down $4.49 at $35.42 on Friday, and had hit a 52-week low of $35.01 in intraday trading.

Motorola bumped up

Motorola
MSI, -0.33%
moved up 50 cents to $19 over Redibook. The company said it is planning to market its proprietary handset chip and software technology to rival cellular phone makers. The company did not specify sales expectations. Analyst Per Lindberg at Dresdner Kleinwort Wasserstein said the move "should not only boost Motorola's semiconductor sales and, in all likelihood profitability, but also lower barriers for Asia."

Also giving the stock a lift was a report in Barron's over the weekend that suggested the communications chip market is headed for a recovery.

"We are encouraged that despite the current industry slowdown, Applied Micro plans to aggressively move forward with its new product development since we believe new products will drive the company's growth," Analyst Paul Brandeis said in a note to clients.

Anadigics takes pre-open dive

Anadigics
ANAD
tumbled $2.45, or 12 percent, to $18.55 after reporting second-quarter losses that were 4-cents wider than expected, and warning of a third-quarter shortfall. The maker of radio frequency integrated circuits reported losses of 48 cents per share, versus a profit of 21 cents a share in the same period a year ago. Revenue for the quarter ending June fell 60 percent to $18.9 million. The company anticipates reporting losses of 55 cents a share on revenue of $15.5 million in the third quarter, while analysts were looking for per-share losses of 36 cents.

Polymedica slides

Shares of PolyMedica
PLMD
were knocked $5.04, or 11 percent lower, to $42.49. The medical products company said late Friday that it would not be listed on the New York Stock Exchange after the open of trading Monday as previously expected. The NYSE notified the company of its decision, but did not give a reason.

Separately, says it expects to report first-quarter earnings of 65 cents a share on revenue of $63 million, up from a previous outlook for earnings of 63 cents a share on revenue of $62 million.

TI slips ahead of report

Texas Instruments
TXN, -0.43%
hit $31.20, down 31 cents, according to market makers at Madoff Securities. The stock ended down 4 percent at $31.51 on Friday.

In a negative for the chips, Germany's Infineon Technologies
IFX, -4.44%
said on Monday it expects to post fiscal fourth-quarter and full-year losses. Shares (623100) were down 2.5 percent in Frankfurt.

McDonald's gets Merrill boost

McDonald's Corp.
MCD, +0.42%
- expected to report second quarter results on Tuesday - was up 48 cents to $28. Merrill Lynch upgraded the stock overnight to a buy, intermediate term, from an accumulate.

"Fueled by an expected turnaround in key European market, (we) foresee much improved earnings per share visibility by the fourth quarter," analyst Peter Oakes told clients. He's expecting the results on Tuesday "to mark a bottom in investor sentiment" in the stock.

T, DIS lower

Shares of AT&T
T, -0.35%
were off 40 cents at $20.50 after reports surfaced over the weekend that Comcast
CMCSK
isn't likely to raise its $52.4 billion offer for AT&T's cable television business. See full story.

Elsewhere, shares of Walt Disney
DIS, +0.68%
eased 30 cents to $26.70 amid wide-spread reports that the company is buying the Fox Family WorldWide from News Corp.
NWS, +1.64%
and Saban Entertainment for $5.3 billion. See full story.

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